India could become the first digital, cashless society

Indian Prime Minister Narendra Modi gestures during a session of the St. Petersburg International Economic Forum (SPIEF), Russia, June 2, 2017.
REUTERS/Mikhail Metzel/TASS/Host Photo Agency/Pool
The top news out of India over the past 12 months has been Prime Minister Modi's move to ban 85% of the currency in circulation. However, something much more far-reaching has happened.

It's called India Stack.

The Foundations of a New Financial System

Before 2009, half of all Indians didn't have any form of identification, not even a birth certificate.

Without a form of identification, citizens couldn't access services like banking, insurance, or even get a driver's license. As such, many opportunities like starting a business were not available to them.

Then In 2009, India launched Aadhaar.

Aadhaar is a biometric database based on a 12-digit digital identity, authenticated by finger prints and retina scans.

It became the largest and most successful IT project ever. As of 2016, 1.1 billion people (95% of the population) had a digital proof of identity.

But Aadhaar was just the beginning.

Taking Aadhaar to a Whole New Level

In 2016, India added another component to its digitized system called India Stack.

Since demonetization, over $80 billion has flowed into the banking system, and markets liked what they saw.

Since the beginning of 2017, the Nifty Bank Index, which represents the 12 biggest banks in India, is up over 30%. Telecommunications and technology sectors in India are also likely to see rapid growth in the midst of this transformation.

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